Rare earths and critical minerals explorer DY6 Metals (ASX:DY6) has struck a 6-month option to purchase an 80% interest in the Karonga Lithium Project in northern Malawi.
Under the deal with Malawi-based Afro Gifts Mining Company, DY6 has made a $25,000 cash payment to secure the option and subsequently take on due diligence on the project.
Subject to this due diligence, DY6 will then pay $37,500 in cash and $37,500 in shares to the seller in return for its 80% interest in the project.
DY6 will also free-carry Afro Gifts’ 20% interest until the completion of a Pre-Feasibility Study (PFS), and following this, the company will loan-carry Afro Gifts at the Australian Bank Bill Swap rate plus 8%, to be repaid out of profits from the Karonga project.
The project covers 39km-square, and the licence borders DY6’s recent exclusive prospecting licence application in the Karonga area.
DY6 CEO Lloyd Kaiser says the deal with Afro Gifts adds ‘scale and potential’ to the company’s Karonga licence holding.
“Importantly, field reconnaissance at the project identified a number of pegmatites — up to 25m in width and 500m in length — with visually observed lithium-bearing minerals.
We await assay results from the reconnaissance rock chip sampling and look forward to getting back on the ground in the coming weeks.”
“Importantly, field reconnaissance at the project identified a number of pegmatites — up to 25m in width and 500m in length — with visually observed lithium-bearing minerals”
DY6 says it’s planning to take on a detailed geological mapping and sampling program across the Karonga project in early 2024.
The program is expected to take around 4 weeks to complete and is slated to begin before the end of January.
Write to Joshua Smith at Mining.com.au
Images: DY6 Metals
